Closure of sick PSUs: Govt approves revised time-bound norms

THE NDA government on June 6 approved revised guidelines for time-bound closure of sick and loss making central public sector enterprises and the disposal of their movable and immovable assets. The decision was taken at a meeting of the Union Cabinet chaired by Prime Minister Narendra Modi.
The guidelines accord first priority to utilisation of land of central public sector enterprises (CPSEs) under closure for affordable housing as per the relevant...
guidelines of the Ministry of Housing and Urban Affairs. "The revised guidelines would reduce delays in implementation of closure plans of sick/loss making CPSEs. These guidelines will replace the guidelines issued by the Department of Public Enterprises in September 2016. These guidelines provide a broad framework for expeditious completion of various processes and procedures for closure of CPSEs by laying down important milestones in the closure process along with time-lines, outlining the responsibilities of the concerned Ministries/Department/CPSE etc in the process," an official statement said.
They also provide for advanced preparatory action to be taken by administrative ministry/department or CPSE, preparation of closure proposal, settlement of statutory and other liabilities of the CPSE under closure and modalities for disposal of movable and immovable assets in a time-bound manner.
These guidelines shall apply to all sick/ loss making CPSEs, where –
Approval/ in principle approval for closure has been obtained by administrative Ministry/ Department from the CCEA/ Cabinet; or the process for obtaining the approval of the competent authority is underway after the administrative Ministry/ Department has decided for the closure of the CPSE.
By assigning priority to Affordable Housing it would make available land parcels of sick/loss making CPSEs under closure for the Government flagship programme of Affordable Housing being managed by Ministry of Housing and Urban Affairs.
Among 257 operating PSUs in India, Indian Oil, ONGC, and Coal India have emerged as the most profitable state-owned companies, while debt-laden Air India, BSNL, and MTNL have incurred maximum losses in the same year.
According to the Public Enterprises Survey 2016-17 tabled in the Parliament on Tuesday, the losses incurred by BSNL, Air India and MTNL accounted for 55.66% of the total losses by the top ten loss-making Central Public Sector Enterprises (CPSEs).
Meanwhile, government’s think-tank NITI Aayog has identified 40 sick PSUs for disinvestment. In the fiscal year 2017-18, the government, on the back of Rs 37,000 crore OGC-HPCL deal, is all set to earn Rs 1 lakh crore by strategic disinvestment as against targeted Rs 74,000 crore. Next year, the government has set the disinvestment target at Rs 80,000 crore.
The government also announced coal block auction for commercial mining by private companies to bring efficiency and competition in the coal sector.